The benefits of joining an Internet Exchange, such as the CIXP, vary depending on the type of business (ISP, Content Provider, Transit Provider etc.) but typically include a number benefits listed below.
Reduced transit purchase costs via peering
There can be significant cost advantages in connecting to the CIXP. When connecting to the Internet via one or more upstream Internet Service Providers (ISP) transit charges have to be paid to these companies for data routed through the Internet. Organisations connecting to the CIXP can directly negotiate to exchange a proportion of their traffic with other members via peering on a settlement-free basis.
As consumers demand a more responsive online experience, the latency (or delay) on their IP Service Provider's routing connections is an important factor. By connecting the customer directly to the CIXP, the number of hops between the customer and customers of other IP Service Providers, or the servers of content providers that they need to communicate with, is reduced, leading to an improved performance for end users. This benefit is becoming increasingly important as bandwidth sensitive applications become more prevalent (e.g. tele/video/audio conferencing, VoIP, online gaming, video on demand, software distribution; peer-to-peer file sharing, etc.)
Lower cost per Mbps of connection capacity
The CIXP is based upon local area network (LAN) technology and can thus offer much higher capacity and more scalable bandwidth connections to the Internet than WAN based telecom carrier connections offered by ISPs. Higher capacity connections enable faster data transfer and enable large volumes of traffic (e.g. multimedia data) to be shipped to a larger number of customers more quickly.
As the CIXP grows its membership, it becomes increasingly attractive for members to aggregate their traffic into this central hub rather than having to implement, and maintain, multiple links to carriers or content providers. As an example, a company that has three 100Mb connections to three separate carriers may be able to aggregate the same traffic over a single 100Mb connection, providing the carriers are also connected there.
ISPs, content providers and others delivering services over IP who exchange traffic within a given region by peering with each other reduce round-trip delays and enhance value to the all users local to that region. Typically, a provider sourcing content can benefit by peering with those providers servicing a material proportion of their customer community.
Organisations connecting to the Internet via a single upstream ISP are at risk from that ISP, and the connection to it, being a single point of failure. By connecting to the CIXP, members will gain connectivity to the many other members at the exchange, and can therefore spread the risk of any single provider's failure. Contingency arrangements for backup purposes are similarly facilitated.
More flexible choice of connectivity providers
Although, as mentioned above, it will still be necessary for a member to buy connectivity to those parts of the Internet they cannot reach via peering, the presence of many connectivity providers at the exchange creates a large and competitive marketplace where this capacity can be purchased. This competition means that suppliers can be evaluated against each other, leading to lower prices and better levels of service. Additionally, because the members's wide-area connectivity is to the CIXP rather than to one single provider, it becomes much easier to switch suppliers simply by reconfiguring routing across the exchange rather than having to move or install wide-area circuits with attendant delays in carrier service provision. The ability to scale bandwidth for either peering or transit is also greatly simplified.
Greater control of routing arrangements
By negotiating packages of peering and transit arrangements at one or more Internet Exchanges, the ISP, or content provider, can enjoy a much greater degree of autonomy about how it routes its traffic, to which part of the Internet, and by what means. This gives them far greater control and the potential for better utilisation of resources.